3PL – Third Party Logistics

You may have heard the term 3PL or Third Party Logistics and wondered what it means – Well, therein lies the question!

There is, of course, a definition for 3PL, but it can mean so many different things to different companies, particularly when an additional service or perhaps a product is added.

Here’s one 3PL definition from Wikipedia

“A third-party logistics provider is a company that provides the service to its customers of outsourced logistics services for all, or part of their supply chain management needs.

3PL providers ‘typically’ specialise in integrated operations, warehousing and transportation services that can be scaled and customised to a customer’s needs. How they’re tailored will be based on market conditions and the demands and delivery service requirements for their products and materials.

Often, these services go beyond logistics and include services related to the production of goods. The provider is generally then known as a supply chain management service provider (SCMSP) or third-party supply chain management provider (3PSCM).”

It is the final paragraph above which more closely describes the services that are offered by Fencor Group.

How we often explain it is by two examples;

In the first, a large International logistics company receives into their warehouse vast amounts of product from China for a particular customer. That product is racked and warehoused to await further instruction. As the customer receives orders they are fed directly into the 3PL provider’s IT system which will then pick, repackage as necessary, load it to their transport and send it on to its next or final destination.

That’s a completely integrated 3PL (Third Party Logistics) supplier.

Whilst we’re not as integrated as that in terms of our offering, we do provide elements of that service and are similar in many ways.

Here’s an example of the service we provide for one particular client;

They manufacture a product but hold no packaging in stock at all. In our facility we stock some one hundred and fifty different lines for them which we’ve manufactured here on site. As our customer manufactures their product, they simply request what they need from us to fulfil each days orders. The packaging they need is taken from stock, loaded to transport and delivered to them on a JIT (Just In Time) basis.

Of course that makes things all sound very simplistic and whilst we work hard to make it as simple as possible, in order to deliver their packaging on time, in full, on a daily basis, it’s necessary for us to take care of;